6 Fundamental Questions Your Project ERP System Can Answer
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Sometimes, taking a 'back to basics' approach when managing your professional services firm can help you get to the heart of what's best for your business.
But what if you're struggling to hone in on what really matters?
Most project-based firms face the same issues surrounding resourcing, profitability and project management time and time again. In fact, using your ERP system to find out the answers to the following six questions could be all it takes to make some significant improvements to your business. The results will speak for themselves:
Project-based ERP for Dummies
1. Which Projects And Clients Are Successful And Profitable?
How good would it be to know the types of clients and projects that will make the most money for your firm?
With project-based ERP, this is entirely possible. Using your firm's historical data, your system will build a picture of the most profitable projects and clients so you can focus your efforts on more lucrative work. Think of all that time you'll save on profit draining ventures that use up more energy than they're worth.
2. How Many Project Hours Do We Need To Bill In Order To Turn A Profit?
Keeping a project in profit means billing only for planned hours. You need to know exactly how much time is allocated to each project and the hours your consultants are logging.
Your ERP system will track time and hours and it will also establish how much capacity teams have at any given time and then ensure you bill for the hours as planned. This will help you avoid costly over-servicing and scope creep.
3. What Rates Should We Charge?
Setting prices may seem a bit of a lottery. Charge too much and your clients may go elsewhere. Charge too little and your margins could be under threat. Visibility into historical project costs, performance and risks/opportunities allows you to set accurate, sustainable and profitable rates for what you do.
4. Who Owes Me Money?
Time from invoice to cash collection plays an important part in the financial health of your firm. It's vital for your cash flow. Your ERP system will scrutinise payments, streamline invoicing and provide a real-time picture of your finances at any given time.
5. How Can We Do More For Less?
Time is always of the essence in any busy firm. So you may want to find ways of creating efficiencies across the operation.
Take financial compliance as an example. Spending too much time on paperwork for audits and assessments is a profit drain for your firm. You'll therefore want to automate as much of the process as possible.
Your ERP system will produce the forms, reports and administration necessary for staying on the right side of compliance. Increased automation and transparency will take the hassle out of best practice, leaving you to get on with the job in hand.
6. Are We Are Profitable Enough For Growth?
How to increase profit. It's a priority at the top of every company' s agenda. Greater insight into financial matters will help you ascertain if you are in a position to invest in the future, or if you should cut back in certain areas.
With this in mind, you'll want to capitalise on the financial capabilities of your system. Through complete visibility into project and financial status, ERP empowers managers and project teams to predict and illustrate potential consequences of their financial decisions and to act in the best interests of their firms. It'll take all of the guesswork and assumption out of your strategy for growth.
Through setting competitive rates, utilising resources, controlling compliance, maximising cash flow and increasing visibility into financial matters, the benefits of ERP become obvious when focusing on key issues.
For more insight, download the 'Project-Based ERP for Dummies' eBook.
Understanding ERP - Introduction Series
- What Is ERP And Why Do Businesses Use It?
- The Five Components Of ERP Software And Their Individual Powers
- Mastering Project KPIs With Business Intelligence Software
- Project ERP vs Generic ERP - Just What Is The Difference?
- Using A Project ERP System To Plan A Project
- How To Make Time Recording Easier With Project ERP
- 7 ERP Terms Every Project Manager Should Know
Project-based ERP for Dummies
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- Architecture & Engineering Firms
- Business Intelligence
- Change Management
- Cloud ERP
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- Deltek Customers
- Financial Management
- Job Costing
- Legal Sector
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- People and Culture
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- Professional Services Industry
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- Project Management
- Project Portfolio Management
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- Scheduling And Planning
- Talent Management
- Time and Expenses
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